The Welfare Effects of Tax Competition Reconsidered: Politicians and Political Institutions

• 成果类型: Article
• 署名作者: Janeba, Eckhard; Schjelderup, Guttorm
• 署名单位: University of Mannheim; Leibniz Association; Ifo Institut; Norwegian School of Economics (NHH)
• 刊物名称: ECONOMIC JOURNAL
• ISSN/ISSBN: 0013-0133
• DOI: 10.1111/j.1468-0297.2009.02263.x
• 发表日期: 2009
• 页码: 1143-1161
• 关键词: delegation

摘要

The views on the welfare effects of tax competition differ widely. Some see the fiscal externalities as the cause for underprovision of public goods, while others see tax competition as the means of reducing government inefficiencies. Using a comparative politics approach we show that tax competition among presidential-congressional democracies is typically welfare improving, while harmful among parliamentary democracies if under the latter public goods are sufficiently valued. The results hold when politicians seek re-election because of exogenous benefits of holding office. By contrast, when politicians hold office only to extract rents, tax competition is harmful if politicians are sufficiently patient.